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Renault doubles estimate for lost production as chip crisis deepens

Renault has warned its manufacturing will likely be hit far tougher by the trade’s chip scarcity than the French carmaker feared simply two months in the past.

The corporate on Friday stated it’ll produce nearly 500,000 fewer autos this yr, a considerably greater dent within the group’s output than the 220,000 misplaced autos it predicted at first of September.

The gloomier forecast got here as Renault reported a pointy decline in third quarter gross sales. Revenues for the quarter have been €9bn, 13.4 per cent decrease than the identical interval a yr in the past, and much shy of the €11.3bn generated in the identical quarter in 2019 earlier than the pandemic struck.

Carmakers from Volkswagen to Toyota have been compelled to chop manufacturing due to semiconductor shortages, costing the trade thousands and thousands of misplaced autos and at a time auto teams have been anticipating a serious post-pandemic restoration.

In addition to the drag from the dearth of chips, which carmakers face fierce competitors for from client electronics teams, Renault’s third quarter gross sales additionally suffered a troublesome comparability to 2020, after they have been boosted by pent up demand.

Regardless of the drop in gross sales, Renault, which doesn’t disclose profitability within the first and third quarters, stated it expects margins within the second half to match the two.8 per cent reported for the primary six months of the yr.

Chief monetary officer Clotilde Delbos stated the forecast got here “regardless of the deterioration in parts availability within the third quarter and diminished visibility for the fourth quarter”.

Though disruptive to manufacturing, the chip scarcity has helped carmakers enhance pricing by stripping away the necessity for discounting beforehand as rival producers chased increased gross sales numbers.

Renault stated its present order financial institution is at 2.8 months of gross sales, the best stage in 15 years.

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